Safe and Sound

RED RIVER EMPLOYEES

TEXARKANA, TX

4

Star Rating

Founded in 1943, RED RIVER EMPLOYEES is an NCUA-insured credit union based in TEXARKANA, TX. As of December 31, 2017, the credit union held assets of $876.8 million.

Thanks to the efforts of 306 full-time employees, the credit union has amassed loans and leases worth $653.5 million. RED RIVER EMPLOYEES's 105,294 members currently have $768.2 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, RED RIVER EMPLOYEES exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Here's a breakdown of how the credit union did on the three important criteria Bankrate used to grade American credit unions.

THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring an institution's financial strength, capital is important. It acts as a buffer against losses and provides protection for members when a credit union is experiencing financial trouble. When looking at safety and soundness, more capital is preferred.

RED RIVER EMPLOYEES received a score of 12 out of a possible 30 points on our test to measure capital adequacy, lower than the national average of 15.65.

RED RIVER EMPLOYEES had a capitalization ratio of 12.00 percent in our test, below the average for all credit unions, a sign that it's on less solid financial footing than its peers.

Asset Quality Score

Bankrate uses this test to estimate the effect of troubled assets, such as unpaid loans, on the credit union's loan loss reserves and overall capitalization.

Having extensive holdings of these kinds of assets suggests a credit union could eventually have to use capital to absorb losses, shrinking its equity buffer. It also means that there are likely to be many assets that are in non-accrual status and no longer earning money, diminishing earnings and increasing the risk of a failure in the future.

RED RIVER EMPLOYEES scored 36 out of a possible 40 points on Bankrate's test of asset quality, less than the national average of 38.09.

A lower-than-average ratio of problem assets of 0.00 percent in our test was potentially indicative of greater financial strength than other credit unions.

Earnings score

A credit union's profitability has an effect on its safety and soundness. A credit union can retain its earnings, increasing its capital cushion, or use them to address problematic loans, likely making the credit union better prepared to withstand economic trouble. Losses, on the other hand, reduce a credit union's ability to do those things.

RED RIVER EMPLOYEES outperformed the average on Bankrate's earnings test, achieving a score of 18 out of a possible 30.

The credit union had an earnings ratio of 0.00 percent in our test, higher than the average for all credit unions, suggesting that it's beating its peers in this area.

Bankrate.com's Safe & Sound Ratings provide a star rating system to evaluate the current financial status of financial institutions. The information gathered about banks, credit unions and thrifts is updated as set forth in the Terms of Use of Safe & Sound Ratings and Reports. The Safe & Sound Ratings information is grouped by categories of banks, thrifts and credit unions.

Scoring methodology

Bankrate.com evaluates the financial condition of institutions and assigns a one- to five-star rating for each with five stars representing the highest rating. Institutions with satisfactory performance will generally receive a rating of three or more stars. The majority of institutions fall into the three- to four-star range. An institution with an "NR" rating may be too new to rate or may have limited the publicly available information in their regulatory filings. The "NR" is not an indication of financial strength or weakness. The Safe & Sound rating is believed to be reliable, but the information is not guaranteed. In addition, events since the information was collected may have altered the institution's financial condition.

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